The bipotent cell line, PC12, derived from rat adrenal pheochromocytoma was used as an in vitro model for our studies. To examine the effect of human chorionic gonadotropin (hCG) on PC12 differentiation, wild type human luteinizing hormone/chorionic gonadotropin receptor (LH/CG-R) was transduced into PC12 cells and stable transgene-expressing subclones were used for experiments. Activation of transduced LH/CG-R with hCG/LH or expression of a constitutively activated mutated LH/CG-R in PC12 cells induced distinct morphological and biochemical changes characteristic of neuronal differentiation. The differentiation effect of hCG was ligand dose- and time-dependent. Western blot analysis revealed that both the extracellular signal-regulated kinases (ERKs) and p38 mitogen-activated protein kinase (MAPK) were activated after hCG treatment. Inhibitor studies showed both the ERK and p38 MAPK signal transduction pathway were indispensable for the differentiation process. In addition, the Phospholipase C (PLC) pathway was partially involved in hCG induced PC12 differentiation. These findings imply a potential role of hCG/LH and LH/CG-R in the neurogenesis of the mammalian nervous system. We further investigated the possible effect of hCG in the initiation of myelination. Myelin protein zero (P0) is the major component of the myelin sheath of the peripheral nervous system and is induced at the initial phase of myelination. hCG when combined with Forskolin dramatically increased P0 mRNA expression in a mouse Schwann cell line transiently expressing LH/CG-R in vitro. Examination of P0 protein expression is underway. The result suggests hCG may promotes myelination through inducing P0 expression. The mechanism of hCG induced P0 expression could be through several transcription factors such as krox-20 and is under investigation. These studies show that hCG/LH and its receptor participate in the development and maintenance of the mammalian nervous system. hCG could be a potential regeneration drug for future treatment of acute neural injuries or neurodegenerative disorders.